Walt Disney, Scripps Networks Lead No. 1 Media Sector

Few would bat an eye at the fact that among 33 sectors tracked daily by IBD, media is currently No. 1. After all, we live in a media-saturated world.

So, what is surprising? The puny number of high-quality stocks that give IBD-style investors a chance to make big money.

Warren Buffett is famous for making fat profits after buying a stake in Washington Post Co. (WPO) in the 1970s. But in growth investing, the best chance for success lies in companies with superior profit and revenue growth, strong margins, and excellent relative price strength.

At No. 6, Media-Newspapers ranked the highest among five media-specific industry subgroups in Tuesday's IBD. But the investing cupboard is practically bare.

Of the seven newspaper stocks, just two trade at least 10 a share: Gannett (GCI), owner of USA Today, and thinly traded Daily Journal (DJCO). Gannett recently bought web advertising firm BLiNQ to beef up its revenue from social networking sites.

The next-best group, 23rd-ranked Media-Diversified, has more companies that are thriving far better than newspaper chains. Within the 19-member group (Class A and Class B shares are counted separately), four companies sport an EPS Rating of at least 80. Among these, Walt Disney (DIS) and Scripps Networks (SNI) lead.

The former is moving sideways after bottoming out near 28 in October and clearing a six-month cup with handle at 40.35 on Feb. 6.

Support at the stock's 10-week moving average has created follow-on buy chances.

Disney, famous for its TV properties including ESPN and the ABC family of channels, continues to make its amusement parks a revenue generator. Recently, the Anaheim-based California Adventure theme park opened a new ride based on the animation movie sensation "Cars" and drew big crowds.

Scripps, the Food Network owner, was discussed in The Income Investor on Aug. 6.

Media-Radio/TV, No. 51 in Tuesday's IBD, has five stocks with EPS and RS Ratings of 80 or better. Sinclair Broadcast Group (SBGI) (EPS 99, RS 91) is the only one that trades at least 400,000 shares a day. It's trying to break out of a base.

See Also

A stock's Relative Strength line measures how well it's performing compared to the entire S&P 500 index. Stocks whose RS line is rapidly rising are good candidates for a stock watch list. Today's IBD Screen Of The Day, Bolting RS Lines, includes top-rated stocks such as Walt Disney (NYSE:DIS) ...

The Peacock is turning into a Mouse, judging by Comcast's stellar Q2 results at its NBCUniversal's film division and theme parks. Cable TV leader Comcast (NASDAQ:CMCSA) — which audaciously tried to buy Walt Disney (NYSE:DIS) in 2004 and was rebuffed, only to acquire NBCU from General Electric ...

Top U.S. movie studios as well as British broadcaster Sky UK have been accused of improperly restricting European viewers outside Britain and Ireland from accessing paid content. European regulators opened an investigation into Walt Disney (NYSE:DIS), Comcast's (NASDAQ:CMCSA) NBCUniversal, Viacom's ...

Think dividend stocks are boring? A look at the top three outperforming Dividend Leaders could very well change your mind. These stocks offer a bigger dividend than the 1.93% average yield of the S&P 500, and they're trouncing the market this year. Not even high-growth stock Apple ...

07/22/2015 05:33 PM ET

More IBD Industry Themes Articles:

The travel-booking industry group was the top performer Friday, and Expedia (NASDAQ:EXPE) was a big part of the reason. It gapped out of a base to an all-time high after an upbeat Q2 report. Priceline (NASDAQ:PCLN) also gapped higher and was trading near a buy point. And Sabre (NASDAQ:SABR) broke ...

Shoemakers were the top-performing industry group Thursday, led by a spectacular move in Skechers (NYSE:SKX), which reported blowout earnings. But it wasn't just Skechers. Crocs (NASDAQ:CROX) was higher on big volume as well after a quarterly report that wasn't anywhere as good as Skechers, but ...

The Internet content industry group has lost some luster in the past year and a half. The group made a handsome gain from mid-2012 to early 2014, nearly doubling. That rise put it among the best performing of 197 groups that IBD tracks. Since then, it's moved sideways, with key names among the 61 ...

Masco (NYSE:MAS) became the latest company to forecast continued growth in the home remodeling and construction markets as the stock soared Tuesday after reporting Q2 results. "We believe the underlying demand for our products will increase and that the repair and remodeling business will continue ...

Apple's (NASDAQ:AAPL) "HomeKit" has been slow to gain traction in the home security market, but AT&T (NYSE:T) and Comcast (NASDAQ:CMCSA) are making inroads vs. incumbent ADT (NYSE:ADT), says a Citigroup report. Apple launched HomeKit in 2014. So far, there are only 15 HomeKit-enabled ...

About Investor's Business Daily

Investor’s Business Daily provides exclusive stock lists, investing data, stock market research, education and the latest financial and business news to help investors make more money in the stock market. All of IBD’s products and features are based on the CAN SLIM® Investing System developed by IBD’s Founder William J. O’Neil, who identified the seven common characteristics that winning stocks display before making huge price gains. Each letter of CAN SLIM represents one of those traits.

Select market data is provided by Interactive Data Corp. Real Time Services. Price and Volume data is delayed 20 minutes unless otherwise noted, is believed accurate but is not warranted or guaranteed by Interactive Data Corp. Real Time Services and is subject to Interactive Data Corp. Real Time Services terms. All times are Eastern United States. *Reflects real-time index prices.